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Moving to the cloud? Not without a good business case, you don’t

The impact on apps, whether to leave them where they are or re-host them in the cloud, is just one of the many factors organizations must weight when considering a move to the cloud.

Jeff Rowe | Nov 08, 2017 11:47 am

Despite the growing popularity of cloud computing across all sectors, including healthcare, experts say IT managers still need to be as sure as possible to make a thorough business case before recommending that a company move some or all of its IT resources.

At ZDNet, writer Steve Ranger lays out what he thinks any organization, healthcare or otherwise, should be weighing in order to justify a move to the cloud.

“Cloud migration may be a tougher proposition than a standard IT project,” he notes, “because companies have to consider a wider variety of issues -- like what to do with all those servers, or even entire data centers, that may be made redundant by the move.”

Given that complexity, Ranger says any business case should calculate the costs of migrating to the cloud, then compare them to the costs of keeping systems in-house.

For starters, he says, a business case has to be founded on an understanding of the organization’s business objectively; specifically, why the organization is intending to move to the cloud, and what it wants to get out of it. 

He quotes Mario Thomas, senior consultant of global advisory at AWS, who recently explained that building a business case isn't only needed for a full-scale move to the cloud.  It’s also worth doing by companies using the cloud in different ways, starting with standalone cloud projects, as well as when companies are testing out a hybrid model.

Among the considerations both Ranger and Thomas discuss are the potential for infrastructure savings, which can be the most significant part of the business case in terms of cost savings.

"We typically find that on-prem IT is about 45 percent utilized,” Thomas said. “That's actually quite high -- we know estates that are lower in the five to 15 percent utilization space. That's a huge amount of excess capacity that isn't being used and is being paid for by companies.”

Other factors to include are the cost of connectivity, such as leased lines, the current number of physical servers, virtual servers, and details of specifications like CPUs, cores and RAM. “The cost of storage including SAN, NAS, and direct attached storage also needs to be added, as well as any potential upcoming hardware refresh plans that could potentially be avoided.”

Finally, Ranger notes, the cloud business case also needs to include people costs, which can be second only to the infrastructure costs in some cases. “Companies considering a move to the cloud need to consider, for both staff and contractors, the cost of recruitment, retention, replacement and retirement, training and development, plus the physical space requirement (e.g. offices) plus equipment and any other services. Companies also need to consider any other third-party costs and contracts -- including early termination policies.”